Ghost Writer Heir Haunts Jersey Boys Collaborators

Lawyer, journalist and “Four Seasons” fan Rex Woodard and Thomas DeVito, an original band member, entered into a written agreement for Woodard to ghostwrite DeVito’s autobiography (the Work).  Woodard and DeVito agreed to split the proceeds from publishing and exploiting the Work.  Woodard died in 1991, after completing the Work, but before publication.  DeVito registered the Work under his name four months before Woodard’s death.  The Work was never published.

A convoluted series of agreements and events followed.  Ultimately, the musical “Jersey Boys” incorporated some portion of the Work.  Donna Corbello, Woodard’s widow and heir, sued DeVito, band members Frankie Valli and Robert Gaudio and the writers, directors and producers of the “Jersey Boys” for a variety of claims, including copyright infringement.  Corbello argued that “she, as legatee of Woodward’s joint copyright in the Work, deserves to share in the profits reaped by the various Appellees’ licensing and assignment, or infringement, as the case may be, of the underlying rights.” (Opinion pdf page 8).  The district court ruled against Corbello on all issues and taxed costs against her.

The Ninth Circuit framed the issue:  “We must decide whether a contractual grant of the exclusive right to use an individual’s ‘biographies’ to create a Broadway musical stage play also constitutes a transfer of a copyright ownership interest in that individual’s unpublished autobiography.”  (Opinion pdf page 5).

Accounting and Declaratory Relief

A co-owner of a copyright must account to other coowners for any profits he earns from licensing or use of the copyright.

(Opinion pdf page 9).

Corbello’s ownership of her husband’s interest in the copyright of the Work is not in dispute.  At Corbello’s request, the Copyright Office later amended the copyright registration certificate to list Woodard and DeVito as coauthors and co-claimants of the Work.  The dispute arises out of whether DeVito transferred some portion of his copyright co-ownership to Valli, et al. (Appellees.)  Corbello can succeed in her declaratory relief and equitable accounting claims only if DeVito transferred some portion of his copyright co-ownership interest to the Appellees.

In a 1999 Agreement, DeVito granted Valli and Gaudio an exclusive right to use Materials, including biographies, in theatrical productions.  The district court concluded that “biographies” in the 1999 Agreement did not include the Work for purposes of transferring copyright ownership in the Work. 

The Ninth Circuit disagreed.  New York law governed the 1999 Agreement.  The Ninth Circuit determined that under New York law, the 1999 Agreement was unambiguous on its face.  The dictionary definition of the word “biography” includes the Work.

DeVito cannot plausibly claim to have retained his privilege as a copyright co-owner to create derivative theatrical works of any biographical manuscript he owns, yet surrendered exclusively to others his generic ‘life story,’ along with his name and likeness, to create a play. Relinquishing one’s right to exploit creatively his or her ‘life story,’ while at the same time retaining a corresponding right over one’s written biography, would be a self-defeating endeavor. We decline to impute such an incompatible purpose to the definition of ‘biographies’ in the 1999 Agreement.

Pursuant to the 1999 Agreement, DeVito granted Valli and Gaudio the ‘exclusive right to use’ his ‘biographies,’ unambiguously including the Work, to create a play. Such play constitutes a ‘derivative work,’ the right to create which resides in each copyright holder of the underlying work and may be transferred by that holder to a third party.  Thus, in granting this exclusive right to create, whether classified as an exclusive license or an assignment, the 1999 Agreement constitutes a transfer of ownership of Devito’s derivativework right in the Work to Valli and Gaudio.

(Opinion pdf pages 12 – 13).

Appellees argued that Ninth Circuit precedent prohibits a co-owner of a copyright from transferring that right without permission from the other co-owner.  The Ninth Circuit distinguished its prior decision from the present case:

We held that when one co-owner independently attempts to grant an exclusive license of a particular copyright interest, that licensee does not have standing to sue alleged third-party infringers.  After all, one co-owner, acting independently, may not limit the other co-owners’ independent rights to exploit the copyright.  Such a conclusion stems from the selfevident principle that a joint-owner cannot transfer more than he himself holds; thus, an assignment or exclusive license from one joint-owner to a third party cannot bind the other joint-owners or limit their rights in the copyright without their consent. In other words, the third party’s right is ‘exclusive’ as to the assigning or licensing co-owner, but not as to the other co-owners and their assignees or licensees. As such, a third-party assignee or licensee lacks standing to challenge the attempted assignments or licenses of other copyright owners.

(Opinion pdf page 16).

Therefore, precedent presents no obstacle to Devito’s exclusive transfer of his derivative-work right to Valli and Gaudio under the 1999 Agreement. Because the Agreement unambiguously transfers Devito’s derivative-work right to Valli and Gaudio, and copyright co-owners must account to one another for any profits earned by exploiting that copyright, the district court erred in rejecting Corbello’s claims for accounting and declaratory relief.

(Opinion pdf page 18).

Copyright Infringement

The 1999 Agreement transferred ownership DeVito’s derivative-work right in the Work to Valli and Gaudio.  Ordinarily, Corbello would not be able to sue Valli and Gaudio for copyright infringement.  “A co-owner of a copyright cannot be liable to another coowner for infringement of the copyright.  (Opinion pdf page 19).  But the Ninth Circuit ruled that a material issue of fact exists regarding whether the 1999 Agreement’s reversionary clause terminated Valli and Gaudio’s ownership right.  If the reversionary clause terminated Valli and Gaudio’s ownership right, the result is that the Appellees may be infringing Corbello’s copyright interest.

The Ninth Circuit ruled that there was contradictory evidence regarding whether the reversionary clause terminated Valli and Gaudio’s derivative-word right, comprising disputed materials facts that preclude summary judgment on the copyright infringement issue.

The Ninth Circuit remanded the case to the district court for further consideration of the copyright infringement issue and an implied license issue, not discussed in this post.  The Ninth Circuit also vacated the assessment of costs against Corbello and awarded Corbello costs on appeal.

This case is Corbello v. Valli, No. 12-16733, Ninth Circuit Court of Appeals.

Judge Diarmuid F. O’Scannlain wrote the majority opinion, in which Judge Carlos T. Bea joined.

Judge Robert D. Sack wrote a concurring opinion.

I agree that we must remand this case to the district court for further proceedings. I disagree, however, that the word ‘biographies’ in the 1999 Agreement unambiguously includes the manuscript of the autobiography of DeVito ghost written by Corbello’s decedent Woodard for DeVito (the Work), completed some eight years earlier, and that the 1999 Agreement therefore transferred certain derivative rights in the Work to the counter-parties to the Agreement –Valli and Gaudio.

(Opinion pdf page 23).

Judge Sack thinks that the 1999 Agreement transfered a nonexclusive license, not an exclusive license or assignment, as ruled by the majority.  Judge Sack disagreed with the majority’s interpretation of Ninth Circuit precedent on this point:

One co-owner of a copyright cannot confer an exclusive license on a licensee because she or he has no exclusive right to confer.  A co-owner of a copyright cannot unilaterally alienate its share of the intellectual property and instead can only grant a nonexclusive license to a third party.

(Opinion pdf pages 29 – 30).

Valli and Gaudio had a nonexclusive license, and Corbello’s sole accounting remedy lies against DeVito.

(Opinion pdf page 31).

In sum, then, I would decide that the contract is ambiguous as to whether the Work is included within the Materials. Because the contract is ambiguous, the district court erred by determining the meaning of the contract on the basis of parol evidence at summary judgment. I would therefore remand to the district court for further proceedings. But it would vastly simplify matters, I think, if in that case the district court first decided the defendants’ summary judgment motion arguing that Jersey Boys does not infringe the Work as a matter of law in any event, an issue which it previously avoided by granting summary judgment on contract grounds.  That might be the end of the matter as far as ‘Jersey Boys’ Valli and Gaudio are concerned irrespective of the difficult issues that the majority and we address here.

Even if the 1999 Agreement unambiguously included the Work, as the majority conclude, I would decide that DeVito granted Valli and Gaudio only a nonexclusive license to use the Work toward a theatrical production. Corbello’s accounting action properly lies, then, against DeVito, not Valli and Gaudio, and the latter action must be rejected.

(Opinion pdf pages 32 – 33).

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